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Unions vote for an inward, independent inquiry

MARK COLVIN: Delegates at the ACTU (Australian Council of Trade Unions) congress voted this afternoon to establish an independent inquiry to look at the way unions across the country operate.

The move is of course in response to the Health Services Union scandal, where members' funds was spent not only, as we've heard, on political campaigns but prostitutes, travel and lavish entertainment. One senior union figure has already warned that any repeat of the HSU scandal could see unions wiped off the map.

A retired Federal Court judge will chair the new panel. Debate on the resolution's just wound up and our reporter there is Simon Cullen, or was Simon Cullen, because he joins me now in the studio.

Simon what exactly were they asked to vote on?

SIMON CULLEN: Well the resolution before the congress was for an independent panel to be set up. As you say it's going to be headed by the retired Federal Court judge Rod Madgwick. He'll be supported by three other people.

Their terms of reference are quite broad but given as you say the problems in the Health Services Union, their particular focus is going to be looking at financial controls, governance around those types of things and with a particular focus as well on executive remuneration.

MARK COLVIN: And what justification did Dave Oliver, the secretary of the ACTU give for this motion?

SIMON CULLEN: Look essentially it's a sign that he wants to get out to members who have been affected by the tarnished reputation of the unions that union leadership can be trusted. So here is what Dave Oliver had to say in moving this resolution.

DAVE OLIVER: We cannot tolerate the sorts of things revealed in the Fair Work report into the HSU and that kind of behaviour is not acceptable in our movement.

(applause)

Now I know everyone here condemns that behaviour and we have a significant responsibility to our members to ensure and make double sure that member's money is only used for purposes to advance our members' interests. We won't tolerate individuals who breach that responsibility.

MARK COLVIN: Now who'll be on this panel and what powers will they have? You've mentioned Rod Madgwick; he has some industrial relations experience.

SIMON CULLEN: That's right in fact he was quite critical of the Australian Building and Construction Commission. He's going to be supported by three other people; Professor Danny Samson from the Melbourne University, Judith Bornstein from the Victorian Bar and Graeme Russell, from First Super.

Now the powers essentially are going to be up to the unions themselves. So this panel will go around to each individual union, basically try and gauge what sort of financial controls they have in place already.

In terms of their actual terms of reference they're still to be finalised but they won't be doing an audit. Now I think that's one of the key points to be made here.

SIMON CULLEN: Look they certainly won't have the power to do that, although given that this resolution was backed unanimously at the ACTU congress today, I guess the moral pressure is on those union leaders to hand over the records if they're requested.

So they don't have the legal authority I guess but they do have a moral authority to go into unions and carry out that investigation.

MARK COLVIN: Well what are the politics of this; because the Federal Government's already announced tougher rules for unions?

SIMON CULLEN: They have. They've announced tougher legal requirements for financial disclosure and also tougher penalties if there's breaches of those disclosures.

Look part of this action today is directed at the external pressure that they're facing but a lot of it is also directed at the internal pressure.

Ever since the HSU problems have become public many union members have raised concerns with their leadership about the HSU problems; questioning whether it could happen in their own union. And so the rhetoric was quite strong this afternoon; here's a little bit of what Paul Howes, as the head of the Australian Workers Union had to say in the lead-up to the vote.

PAUL HOWES: We have to stand united as one and say no more! It's not on! Give it back and get out! And that's what this congress should make very clear today. If you're here to rip off workers, get out and we're comin' after ya! I commend the resolution to you.

(applause)

MARK COLVIN: Paul Howes of the Australian Workers Union at the ACTU. Our reporter was Simon Cullen.